FROM THE PRESIDENT
FROM THE PRESIDENT
BRANDON RICH | GREYSTAR REAL ESTATE PARTNERS
Defending Our Industry from Rent Control
In the coming weeks , months and years , our industry will increasingly be the target of a growing momentum to enact rent control as a means to soften rent increases and ensure more affordable housing for Colorado ' s growing population .
The government affairs team of staff and volunteers at AAMD and CAA is continually working against this , knowing that while appealing to the average renter , a policy like rent control will have the opposite effect of driving down rents , and poses far more dangers than people realize . In fact , 93 % of economists agree that rent control doesn ’ t work , and Forbes called it one of the 10 worst ideas of the 21st century !
As members of AAMD , it ' s important for us to be educated about issues such as rent control , so you understand why we advocate the way we do . AAMD is creating a video that will be posted and advertised on social media through our new public education campaign website launching in March . In the meantime , here are five reasons that rent control regulations are bad for renters and landlords alike and are not an effective answer to unaffordable housing .
Rent control hurts the very low-income renters that it is intended to help .
Unfortunately , rent control really is too good to be true . Obviously , rent control regulations will help the people lucky enough to live in a rent stabilized housing development . It is ultimately most effective as a political tool that sounds like it will help low-income renters , but actually ends up helping the middle and upper classes as their income continues to increase but their rent doesn ’ t . Why would they ever move out of a rent-controlled apartment when they ’ re getting such a sweet deal ?
93 % of economists agree that rent control doesn ' t work , and Forbes called it one of the ten worst ideas of the 21st century !
Rent control results in increased growth in the overall median rent across the city .
Rent control regulations inevitably and ironically have the opposite effect on the rest of the rental housing market and actually increase rental costs . Enacting rent control policies have time and again proven to increase the overall median citywide rental prices .
Rent control actually results in increased rental costs for the majority of the housing market .
When rent control regulations are put into place , it will only artificially lower the rent for a small percentage of housing units . However , by regulating the market and artificially lowering rental prices in one part of the housing market , the rental prices for the remainder of units in the market will inevitably increase . Therefore , rent control ultimately makes housing even more unaffordable for everyone who isn ’ t fortunate enough to live in a housing development where the rent is controlled .
Rent control attacks the symptoms of the lack of affordable housing rather than the actual source .
Rent control simply addresses the most noticeably symptom of housing strain – high rental prices . However , regulating the market by superficially lowering rents on apartments with a much higher market value does nothing to address the actual problem of the need to provide more affordable units .
Actually , rent control inevitably decreases the amount of affordable rental properties , while increasing the amount of renters in the market . In reality , rent control addresses the high prices but limits the amount of affordable housing even further .
Rent control further restricts the supply of rental units .
First of all , in a housing market regulated by rent control , fewer housing developments will be constructed . Builders will construct commercial buildings instead of housing development to turn a profit . The ultimate effect is that new affordable housing doesn ’ t get built , while the existing housing falls into disrepair .
Defending apartments from rent control was one of the central founding principles of AAMD 50 years ago and continues to be a battle we have to wage , but education is the key . Please help our cause and yours by telling your friends and colleagues about why rent control is such a bad idea .
Visit www . aamdhq . org to learn more about AAMD ' s advocacy efforts , and stay tuned for the new public education website being launched next month .
6 | TRENDS • FEBRUARY 2018 www . aamdhq . org